Although advisors currently have the option to seek expungement of disclosures from their CRD, BrokerCheck, IARD, or IAPD records, the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA) are expanding their efforts to make the process more difficult.
FINRA has yet to release its annual priority list, but CEO Robert Cook outlined a broad plan for the self-regulatory organization in 2022, which includes modifications to the expungement process.
“We want to continue working on a revised package of amendments to the existing arbitration-based process, and we think these amendments would help provide greater confidence that expungements are only happening in accordance with the kind of limited circumstances identified in our rules when the CRD information is clearly inaccurate.”
Do you have a meritless disclosure on your BrokerCheck, IAPD, or CRD record?
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Last May, FINRA temporarily abandoned a proposal on expungement requests. According to President Lisa Bragança of Bragança Law, one of those stakeholders, the Public Investors Advocate Bar Association (PIABA), has been waiting on engagement with FINRA since it dropped the rule proposal after PIABA criticized it as insufficient. In the fall, Cook made similar remarks about expungement.
FINRA also intends to propose changes to its recently-introduced Rule 4111, or “high-risk” regime, that goes live in February. The new rule permits the regulator to impose restrictions on broker-dealers and firms who are proven, serial violators.
According to Cook, a proposal is in the works to make it mandatory for broker-dealers who are subject to the rule to publish their “restricted” status on BrokerCheck.
Do you have a meritless disclosure on your BrokerCheck, IAPD, or CRD record?
Give us a call today at (303) 952-4025 or contact us for a complimentary consultation.
FINRA says the impact of restricted deposits will undoubtedly modify firms’ behavior, therefore protecting investors. But in reality, being labeled as restricted could bring most businesses to their knees, while the financial services industry will undoubtedly lose a considerable number of employees as a result.
If you have a false or factually impossible disclosure or investor complaint on your public record, now is the time to have it removed. Your reputation may be on the chopping block.
Over the last five years, AdvisorLaw has expunged more than 2,000 disclosures from financial advisors and wealth managers’ records.
Do not wait to act if you have a false, factually impossible, or blatantly erroneous disclosure on your public record — outside forces are still working to diminish, if not remove, your ability to be heard altogether.
If you’re interested in learning more about our expungement services, please fill out the form below for a complimentary consultation.